The Oil Drum

Every month, the IEA publishes its Oil Market Report. Today, Adam Porter (thanks, Peaknik) of Resource Investor reported that

The International Energy Agency (IEA) however has slightly less excuse. Energy is their raison d'etre, not political power. Or at least that is what they say. They predicted that in 2005 non-OPEC output growth would be 1.38 mbpd. That figure has now been revised. It now stands at 0.1 mbpd. That in itself may yet be revised, downwards.

So currently the IEA's non-OPEC output growth forecast is only just out. If you could say that an error of 92.75% is `just out'....

Reassuringly the IEA have revised upwards their non-OPEC output growth figure for 2006. Next year they assure us it will now be 1.39 mbpd, not 1.32 mbpd that they had already called. Mind you they do not have to go far to beat this year's prediction.

American `demand destruction' was also in vogue just a few weeks ago. Yes, the IEA told us it was happening. Yet a few weeks later American demand for gasoline rose by 600,000 barrels in one week, to stand at 22.156 mbpd. That is not just a lot. That is a record high, ever.

partially based on IEA's December 13th report. Since IEA publishes monthly, they constantly revise their reports to reflect their current view of reality. But as far as longer term (yearly) forecasting goes in recent years, there seem to be two major discrepancies the IEA makes as the forecast period actually arrives in time versus the IEA predictions made a year or more earlier.

1. Forecast demand revisions go upward year-on-year
2. Forecast non-OPEC supply revisions go downward year-on -year

Stuart plotted IEA raw data versus IEA revisions. Let's take a closer look at trend #2, the IEA year-on-year estimates for non-OPEC liquids supply.